In the neoclassical model, the as curve shifts to the right over time as productivity increases and potential GDP expands.
Potential GDP is the theoretical component where labor and capital are at the highest sustainable rates (i.e. H. at rates consistent with steady growth and steady inflation.
Potential is the maximum ideal output of an economy with a high GDP and maintaining currency and product price stability. Gross Domestic Product (GDP) is the amount of output that an economy could produce given a constant rate of inflation, but the price of rising inflation causes an economy to temporarily produce above its potential level of production. maybe performed.
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When a firm has flotation costs equal to 6.8 percent of the funding need, project analysts should increase the initial project cost by dividing that cost by (1-0.068). The flotation cost is the cost which emerge when a corporation gather its fund by issuing new securities. Underwriting fees, legal fees, registration fees are the common fees that will increase corporate's expense when they issue securities. Therefore, we can consider those fees as a flotation cost.
Answer:
Correct Answer:
a. Manufacture the product at home and let foreign sales agents handle marketing.
Explanation:
For the small Canadian company, manufacturing the product at home (Canada) would afford them the opportunity to protect their new medical product from piracy. Also, they would be able to receive tax incentives from their government as well file for patent of their new innovation.
<em>The foreign agent would strictly be focused on the marketing of the finished product without having access to the detailed information of the product.</em>
